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Additional	Information
Market:	ASX
Sector:	Media
Epic:	.
News:	Latest news
Web Site:	Proactive Investors Australia
Other Articles:	04-01-201030-12-200924-12-2009

Compass Group, Whitbread and Rentokil rise to lift FTSE 100 as property stocks slide

Overview: the FTSE 100 held on to its early gains until the end of the day after a bullish opening on Wall Street, where the main key indices rose in early trade as investors were digesting a flurry of mixed economic updates.

A government report released this morning revealed an unexpectedly large fall in initial jobless claims to 466,000 last week, the lowest level in 14 months. Another report released by the Commerce Department further strengthened the sentiment, showing an increase in spending of 0.7% in October compared to a 0.6% decline in the previous month, while personal income rose by 0.2%. At the same time, the positive effect from the news was offset by an unexpected fall in USD durable goods orders, which declined 0.6% in October after rising 2% in September.

The Dow Jones Industrial Average advanced 0.2%, as did the broader S&P 500 index, while the technology heavy Nasdaq composite added 0.3%.

The FTSE 100 stood 0.7% above the opening level in late afternoon as Compass Group remained firmly in the lead with a gain of more than 6%. Gold miner Randgold Resources (LSE: RRS) was a distant second with a 3% climb, while base metals focused miner BHP Billiton (LSE: BLT) also added 3%. Hospitality company Whitbread (LSE: WTB), pest control giant Rentokil (LSE: RTO) and telecom company Cable & Wireless (LSE: CW) also did well, tacking on more than 2.5%. Insurer RSA (LSE: RSA) and quality and safety control company Intertek (LSE: ITRK) also made it to the leadrboard with gains of over 2%.

Investment management company Man Group (LSE: EMG), specialty chemicals firm Johnson Matthey (LSE: JMAT) and investor Resolution (LSE: RSL) were the biggest fallers among the blue chips, sliding 5%, 4% and 2.5% respectively. Property companies Segro (LSE: SGRO), Hammerson (LSE: HMSO) and British Land (LSE: BLND) also weighed the Footsie down with losses of 1-2%. Retailer Marks & Spencer (LSE: MKS) joined in with a 1% loss.

Commodities

Oil prices inched lower late in the afternoon after posting slow gains in the morning following yesterday’s declines.

January Brent Crude slid to US$76.69/barrel, while US light, sweet crude for January delivery moved down to US$75.91/barrel.

All major oil and gas stocks turned negative in response to the declines in oil prices, with the exception of Cairn Energy (LSE: CNE), which advanced 1.3%. BG Group (LSE: BG) barely held on to the opening level, while other FTSE 100 constituents Petrofac (LSE: PFC) and Tullow Oil (LSE: TLW) declined 1% and supermajors BP (LSE: BP) and Shell (LSE: RDSB) posted marginal losses.

Midcaps fell heavier as while Dragon Oil (LSE: DGO) managed to keep its losses to a minimum, Dana Petroleum (LSE: DNX) declined 3.7% and Heritage Oil (LSE: HOIL) tumbled 6.5%.

Most juniors followed the trend. US focused oil and gas junior Caza Oil & Gas (AIM: CAZA) was at the bottom of the pile with a 9% loss, while Eastern Europe focused junior Aurelian Oil & Gas (AIM: AUL), Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP) and Kazakhstan operating Max Petroleum (LSE: MXP) all lost 7.5%. Peru, Colombia and Cuba operating oil and gas explorer and producer Gold Oil (LSE: GOO) and Ukraine focused gas producer, Regal Petroleum (AIM: RPT) followed with losses of 4%, while US focused junior Empyrean Energy (AIM: EME), Irish oil and gas exploration company Petroceltic International (AIM: PCI) and EU operating Rome-based oil junior Mediterranean Oil & Gas (AIM: MOG) all lost more than 3%.

Miners advance as gold, silver and platinum rise

Precious metals improved today as gold reached a new high at US$1,180/oz, while silver and platinum climbed to US$18.62/oz and US$1,466/oz respectively.

Major mining stocks were on the rise as gold miner Randgold Resources (LSE: RRS) and platinum producer Lonmin (LSE: LMI) advanced 3% and silver miner Fresnillo (LSE: FRES) rose marginally.

Specialty chemicals firm Johnson Matthey (LSE: JMAT) slid 4% after releasing its interim results.

Yamana Gold (LSE: YAU) declined marginally.

Midcaps also rose, but were less buoyant. Gold miner Petropavlovsk (LSE: POG) led the pack with a 1.5% advance, while silver producer Hochschild Mining (LSE: HOC) and Aquarius Platinum (LSE: AQP) posted marginal gains.

South American based explorer Mariana Resources (AIM: MARL) led the juniors, rallying 15%, while Fiji focused gold miner Vatukoula Gold Mines (AIM: VGM) and Kyrgyzstan focused gold explorer and developer Chaarat Gold Holdings (AIM: CGH) followed, advancing 5% and 4% respectively.

Brazil focused gold miner Horizonte Minerals (AIM: HZM), Lesotho operating diamond miner Kopane Diamond Developments (AIM: KDD) and Africa operating gold miner GMA Resources (AIM: GMA) went in the opposite direction, shedding 9%, 7% and 5% respectively.

Copper and nickel climb

Base metals also advanced as copper and nickel rose to US$3.13/lb and US$7.57/lb respectively, while zinc reached US$1.01/lb.

Rio Tinto (LSE: RIO) posted a marginal loss and Vedanta Resources (LSE: VED) was flat. Other mining stocks were on the rise. BHP Billiton (LSE: BLT) led with a 3% climb, while Anglo American (LSE: AAL) and Antofagasta (LSE: ANTO) followed, advancing 2.5% and 2%. Kazakhmys (LSE: KAZ) and Xstrata (LSE: XTA) added 1.5% and Eurasian Natural Resources (LSE: ENRC) rose marginally.

London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) moved with the sector, posting a small gain.

Cement operator Prosperity Mineral Holdings (AIM: PMHL) and zinc mining and recycling specialist ZincOX (AIM: ZOX) led the juniors with gains of 4.5%. South Africa based coal exploration and production company Strategic Natural Resources (AIM: SNR) followed, advancing 3.5%.

Copper and nickel explorer Regency Mines (AIM: RGM), Tunisia focused metal miner Maghreb Minerals (AIM: MMS) and iron ore focused investor Red Rock Resources (AIM: RRR) were in decline, sliding 6%, 5.5% and 5% respectively.

Banks, insurance, private equity

Banking stocks were mixed today as While Royal Bank of Scotland (LSE: RBS) and Standard Chartered (LSE: STAN) lost about 1%, Lloyds (LSE: LLOY) and Barclays (LSE: BARC) posted marginal losses and HSBC (LSE: HSBA) was flat.

Insurers were in buying mode today with the exception of Aviva (LSE: AV) and Legal & General Group (LSE: LGEN), which lost less than 1%. RSA Insurance Group (LSE: RSA) was in the lead, climbing 2.6%. Admiral Group (LSE: ADM), Old Mutual (LSE: OML) and prudential followed with gains of 2%, 1.5% and 1% respectively, while Standard Life (SE: SL) rose marginally.

Private equity firm 3i (LSE: III) posted an insignificant gain.

Large and Mid Cap News

United Utilities (LSE: UU.) (‘UU’) hiked its interim dividend by 5% this morning after reporting solid interim results for the six months ended 30 September 2009.

In its half yearly report, UK based defence and security technology company, QinetiQ (LSE: QQ.) warned that ‘political and economic factors’ were hitting decision making processes on several contracts that the company is bidding for. As a result the company said it was now unlikely to achieve expectations for the full year. The financial results for the first half however indicate that QinetiQ has been benefitting from the weaker US Dollar.

Catalytic converter manufacturing group Johnson Matthey (LSE: JMAT) fell over 3% this morning following its half yearly report (six months ending 30 September 2009), which showed a considerable decline in Revenues and Earnings. However the company said it has performed well given the context of the global economic downturn.

In its half yearly report for the six months ended 30th September, the London Stock Exchange Group plc (LSE: LSE) (‘LSE’) revealed a sharp decline in revenues and earnings however the company also said ‘there are some encouraging elements’ as its primary markets and IT divisions performed well. The company’s shares dropped to an intraday low of £8.31 before recovering somewhat to trade around 1% lower on the day.

The Yell Group (LSE: YELL) moved one step closer to completing its re-financing arrangements with its lenders after closing its open offer fund raising this morning. The company received acceptances in respect of approximately 659 million shares, representing 83.87% of the offer.

Small Cap News

Finsbury Food Group (AIM: FIF) (“Finsbury”), a manufacturer of cake, bread and morning goods, released a brief trading update for the first 17 weeks of the current financial year ending 30 June 2010, ahead of its AGM today. In the statement, the company reported an 11% increase in sales from its Bread and Free From business units, but investors didn’t take well to a 6% decline (in value) of sales in the company’s cake business.

Strategic Natural Resources (SNR; AIM: SNRP) has said that its 74% owned subsidiary Elitheni Coal has secured additional prospecting rights in the Eastern Cap coalfield in South Africa to add tonnage to its current in-situ coal, bringing the total to 185,000 ha (hectares), or five times the size which it started this year.

Amphion Innovations PLC (AIM: AMP) said it has signed a partnership agreement with Kuwait University aimed at establishing and operating a technology transfer unit (TTU) at KU. This facility will be the first in-house TTU in Kuwait.

UK onshore gas producer, Island Gas Resources (AIM: IGAS)(“IGAS”) announced this morning that it intended to seek shareholder approval to complete a fully underwritten placing to raise £13.75 million (£12.7 million net).

London-headquartered oil and gas company Leni Gas & Oil (AIM: LGO) has reported direct and indirect production of 11,342 boe (barrels of oil equivalent), or 371 boepd (barrels of oil equivalent per day) on average, slightly down from September’s 12,034 boe, or 411 boepd.

Victoria Oil & Gas PLC (AIM: VOG) said work on the Logbaba natural gas and condensate project in Cameroon is on schedule and it believes it could be preparing its next well at West Medvezhye gas field in Russia by the end of 2010.

Jatropha plantation and oil producer, Gem Biofuels (AIM: GBF) confirmed this morning that it had commenced commercial crude jatropha oil production in Madagascar. Gem Biofuels was formed in 2004 to take advantage of growing demand for biodiesel in Europe, North American and Australasia.  Since listing on AIM, the company has focused on acquiring and upgrading land in Madagascar for jatropha plantations.

North River Resources (AIM: NRRP) has announced that its non-executive director Martin French has purchased 1.66 million shares in the company, bringing his total interest in the company to 10 million shares, or 1.68%.

Red Rock Resources PLC (AIM: RRR) said its 24.4 percent-held Australia-based associate company Resource Star Ltd (ASX: RSL), focused on uranium exploration in Australia and Malawi, has executed a joint venture agreement with Globe Metals & Mining Ltd (ASX: GBE) in relation to the exploration of Resource Star's Machinga niobium-rate earth elements-uranium project in Malawi.

ValiRx (AIM: VAL) today announced encouraging initial sales at its newly established diagnostic kits business ValiMedix, while the development of the HPV infection test by its joint venture (JV) with bio.be ValiBio has been progressed to meet recent FDA (Food and Drug Administration) guidelines with a prototype test currently undergoing analytical validation.

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